Whether you knew it or not, until two months ago deducting cell phones as a business expense was becoming a risky thing to do. The IRS had been coming down hard on personal use of cell phones, versus business use, and was begining to send out warnings that in order to make deductions you would have to keep onerous records. They were suggesting that you would have to write down the date, time, length and business reason for each call – much like you need to do when deducting mileage for your car. As you can imagine, people aware of this have been up in arms.
The good news is that legislation signed in September has relieved us of this potential nightmare. Thanks to the bill, cell phones are no longer “listed items,” meaning they don’t come under the same kind of personal-versus-business use scrutiny that cars and computers do. They still have to be used for a legitimate business purpose in order to deduct them as a business expense, but don’t require crazy levels of record keeping. Phew! A bullet has been dodged.